Tips for Avoiding Cash for Gold Scams

Cash4Gold This company does extensive ad campaigns, using quotes from satisfied customers to attempt to gain the trust of prospective participants. The idea is that a person takes their unwanted gold items and sends them in an envelope to Cash4Gold. The company will then assign a value to the items and mail the customer a check for the determined amount. Advertisements imply that this money will be sent within 24 hours after the gold is received by the company. There are a few parts to the scam that Cash4Gold is running. First, the company leads potential customers to believe that there will be professional jewelers determining the value of their gold. Instead, cheap, commercially available kits are used by unskilled laborers. The value is not determined until the gold is received by the company, so the gold is already out of the immediate possession of the customer when the amount of a check for compensation is determined. Cash4Gold claims that the customer has the ability to request a return of their items. However, the company only gives the customer 10 days from the date their check was issued to request a return. The company then deliberately delays shipment of the check so that the customer does not receive it until after the 10 day window has expired. Broke Gold.com While this company that advertises on television by running infomercials does not technically scam its customers, it does pay pennies on the dollar for gold. Research of compensation from several different Internet-based cash for gold companies shows that Broken Gold pays as little as 10 percent as much as other companies. The company operates in a way that allows it to gain approval from business associations, but consumers should do some real research into the current price of gold before mailing anything to Broken Gold. As with Cash4Gold, Broken Gold uses a sneaky 10 day return policy with a delayed compensation delivery. Broken Gold sometimes misplaces shipments from customers. When this happens, the company claims that they never received the gold. An insurance claim will be made through the United States Postal Service. The problem with this scenario is that Broken Gold only insures packages from customers for a maximum of $80. If the gold was worth much more than this amount, the customer loses out while Broken Gold will be able to profit from the gold once it is found in the warehouse. Typical Cash For Gold Warning Signs There are some signs that potential cash for gold scam victims can look out for before losing their gold. The most important step to avoiding a scam is researching a cash for gold company online before sending any information or items to them. If the company is running a scam, angry victims of the scam typically post about the negative experience that they have had with the company. Many times, these victims have no case because the company protected themselves through legal fine print listed somewhere on their website. Any customer that decides to send their gold to a cash for gold company should be sure to take plenty of pictures of their jewelry. Companies that make their grading system and their price structure clear on their website are safer than those with very little information. If the customer cannot identify the name of the company, its physical address, and a valid customer service phone number, the company should be avoided. The lesson to be learned from cash for gold scams is that it is generally best to avoid any companies that offer fast money. Even if funds are received, the amount of compensation will almost certainly be for far less than the items are worth. Consumers are better off having unwanted jewelry independently appraised by a professional jeweler and sold locally to a reputable business. For more information, check out this fascinating article on the Consumerist: 10 Confessions of a Cash4Gold Employee.